BLOCK Investment & Profitability Ecosystem Overview
BLOCK
Free Cash Flow -
Reconciliation to GAAP
We define free cash flow as net cash provided by (used in) operating activities adjusted to eliminate for the effects of settlements receivables, customers payable, settlements payable, and PPP
loans less purchase of property and equipment. We believe that it is useful exclude the effects of customers payable, settlements receivables and settlements payable because the amounts
represent customer transactions, move in tandem, and which may result in significant fluctuations depending on timing of the end of reporting period and whether such date is a bank holiday
or a weekend. Accordingly, we do not believe such changes are reflective of the cash generation from our ongoing operations. Additionally, we exclude the effects of PPP loans as we believe the
amounts are not reflective of our ongoing operations. We include the impact of purchases of property and equipment because we consider these capital expenditures to be a necessary
component of our ongoing operations.
68
($ in thousands)
2014
2015
2016
2017
2018
2019
2020
2021
Net cash provided by (used in) operating activities
(112,379)
21,123
23,131
127,711
195,109
327,630
173,110
847,830
Addback: Changes in settlements receivable
50,361
27,420
177,662
305,831
(245,795)
326,596
547,484
346,217
Reversal of:
Changes in customers payable
(49,971)
(69,547)
(172,446)
(242,310)
215,378
(181,520)
(371,598)
(171,555)
Changes in settlements payable
(13,105)
(38,046)
(63,637)
60,651
(41,697)
(143,528)
(15,249)
Purchases and originations of PPP loans
873,579
681,849
Sales, principal payments, and forgiveness of PPP loans
(452,593)
(688,091)
(111,989)
(34,109)
(9,699)
127,595
225,343
431,009
626,454
1,001,001
Less: Purchase of property and equipment
Free cash flow
(28,794)
(37,432)
(25,433)
(26,097)
(61,203)
(62,498)
(138,402)
(134,320)
(140,783)
(71,541)
(35,132)
101,498
164,140
368,511
488,052
866,681View entire presentation